TRADE UPDATE

Food & Agriculture
May 27, 2025

Prepared by DTB AgriTrade

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HIGHLIGHTS

  • UK-EU Agreement: The United Kingdom and European Union agreed to work toward a common sanitary and phytosanitary area, with the UK signaling that it would adopt the EU’s SPS regulations on agricultural trade.
  • USITC: The U.S. International Trade Commission will be conducting a factfinding investigation into the global nonfat milk solids market and export competitiveness.
  • Trade Under Secretary Nomination Advances: The Senate Agriculture Committee advanced the nomination of Luke Lindberg to the Senate floor.
  • Tariff Impacts on Ports: Ports across the U.S. are struggling to adapt to import and export volume shifts resulting from the changing tariff rates.
  • Global Report on Food Crises: A United Nations report found that the number of people experiencing acute food insecurity has increased for the sixth consecutive year.

“I received a call today from Ursula von der Leyen, President of the European Commission, requesting an extension on the June 1st deadline on the 50% Tariff with respect to Trade and the European Union. I agreed to the extension — July 9, 2025 — It was my privilege to do so. The Commission President said that talks will begin rapidly.”

—President Donald J. Trump’s May 25 Truth Social post on negotiations with the European Union. The news followed Trump’s May 23 post that he was recommending a 50% tariff on the EU beginning June 1.

UK-EU Agreement

Working Toward a Common Sanitary and Phytosanitary Area

  • After months of negotiations, the European Union and the United Kingdom announced a Strategic Partnership agreement on May 19. The two sides agreed to work toward a common SPS area, with the UK largely accepting EU regulations on agricultural technologies. The agreement also seeks to reduce “red tape” by removing some checks on imports of animal and plant products. Regulatory independence and taking back control were among the primary objectives of Brexit supporters.
  • While the deal lays out significant changes to UK trade rules to bring them in line with European regulations, UK Prime Minister Keir Starmer insists the UK is still committed to remaining outside the EU’s single market and customs union.
    • EU Commission President Ursula von der Leyen called it a “historic moment” and said that a common sanitary and phytosanitary area “means more certainty, more stability for farmers and food producers, and fishermen and fisherwoman, on both sides of the Channel.”
    • In their joint statement, Brussels and London confirmed their “steadfast dedication to the rules based international order” and “commitment to free, sustainable, fair and open trade.”
  • The deal also includes pacts on defense and migration, eases restrictions for travel and work, extends access to UK waters for EU fishing boats, and opens the European electricity market to the UK.
    • The Strategic Partnership marks a resetting of the UK-EU relationship post-Brexit. The EU is the UK’s largest trading partner and the biggest market for British agri-food exports (in 2024, 41% of UK exports went to the EU, and over half of UK imports came from the EU. The UK was the second largest market for European exports).
  • The UK also recently reached an agreement with India and the outline of a deal with the United States; U.S. agriculture groups have urged USTR to use negotiations with the UK to resolve longstanding SPS barriers.
Photo: European Council  

USITC

Nonfat Milk Solids Investigation

  • The U.S. International Trade Commission will be conducting a factfinding investigation into the global nonfat milk solids market and export competitiveness at the request of the Office of the U.S. Trade Representative.
  • The investigation will include an overview of global markets, profiles of exporters, and a comparison of competitiveness.
  • Written submissions are due October 14, 2025, and a public hearing is scheduled for July 28, 2025.
  • The United States exported 745,097 MTs of skim milk powder (HS040210) in 2024, nearly half of which went to Mexico.

Trade Under Secretary Nomination Advances

Senate Ag Sends Lindberg for Floor Vote

  • The Senate Agriculture Committee advanced the nomination of Luke Lindberg to be USDA Under Secretary for Trade and Foreign Agricultural Affairs, along with Devon Westhill to be Assistant Secretary for Civil Rights.
  • Committee Chairman John Boozman (R-AR) noted Lindberg and Westhill are “critical to implementing President Trump’s agenda at the department and advocating for America’s farm families” and encouraged quick action by the Senate.
  • Both nominations will now go to the Senate floor for further consideration.

Tariffs

Uncertainty Having Impacts on Ports

  • Ports across the U.S. are struggling to adapt to import and export volume shifts resulting from the Trump administration’s changing tariff rates. At a media briefing on May 19, Port of Los Angeles Executive Director Gene Seroka said the “tariff policies are more widespread and sweeping than any we’ve ever seen in our lifetime.”
    • The Port of LA, the busiest U.S. port, saw a 30% decrease in imports during the first week of May from 2024 levels. Seroka expects overall numbers for May will show a substantial drop in imports (following 10 months of growth, partially caused by goods being brought in ahead of tariffs).
    • So far in May, there is a 3.5% decrease in exports compared to 2024, building on five months of declining exports. Seroka expects “with retaliatory tariffs now in play, we’ll continue to see significant challenges on that side of the ledger, particularly in the agriculture and manufacturing sectors for the foreseeable future.”
    • Looking ahead, the 90-day reduction in tariffs between the U.S. and China will likely result in a temporary increase in shipments, though Seroka says he does not expect a surge that would overwhelm the port’s capacity, given that prices are still elevated and shipments will be dispersed across U.S. ports.
    • Depending on future tariff actions, there will likely be a further decrease in both imports and exports later in the year, heading into peak shipping season. Seroka noted that if ongoing tariffs result in lower Chinese imports, it will mean “lower inventory levels across the board, less selection for American consumers and maybe higher prices.”

Global Report on Food Crises

UN Releases Global Report on Food Crises

  • The United Nations released the Global Report on Food Crises 2025 on May 22. It found that the number of people experiencing acute food insecurity has increased for the sixth consecutive year. Additionally, the number of people facing catastrophic levels of food insecurity doubled between 2023 and 2024 and roughly 37.7 million children aged 6-59 months experienced acute malnutrition, according to the report.
  • The report identified the driving factors of food insecurity as: increased conflict (the top driver, impacting many regions including the Democratic Republic of Congo, Haiti, the Sudan, South Sudan, Myanmar, and the Gaza Strip); the impacts of climate change and changing weather patterns on agriculture; and economic shocks, inflation, and trade disruptions. It also noted the issue of funding shortages for humanitarian efforts, which is expected to worsen in the coming months given U.S. cuts to its global aid.
    • The introductory outlook notes the effects of trade wars and resulting inflation and financial turmoil on acute food insecurity. It states that “in early 2025, the introduction and posturing of increased tariff rates fueled uncertainty and introduced volatility to the global economic environment. As a result, global growth projections were downgraded, falling from 3.3 percent in January to 2.8 percent in April 2025.”
    • The report went on to say that “as long as policy uncertainty remains high, there is a substantial risk of further slowdown of global economic growth and, possibly, even a global recession.” It adds that countries and territories that face food crises “are particularly vulnerable to the uncertainty and effects of these new dynamics.” The report further states that “country-specific tariffs risk compounding these effects, especially in countries with a high export-to-gross domestic product (GDP) ratio in Asia, Southern Africa and Latin America.”
    • In his introduction to the report, UN Secretary-General António Guterres said, “Trade must become a driver of food security – not a barrier to it. We need fair, transparent and resilient trade systems that ensure food can move efficiently, especially during crises.”